SINGAPORE (Mar 1): Yongnam Holdings reported full-year losses narrowed by half to $15.8 million in FY17 from $31.6 million in FY16 on improved margins for some of its projects.

Revenue for the full year fell 4.6% to $306.7 million in FY17 from $321.4 million in FY16 due to lower contributions from its structural steelworks and mechanical engineering businesses, which more than offset the increase in revenue contributions from its specialist civil engineering segment.

On a geographical basis, Singapore remained the group’s core contributor of revenue, accounting for 88.1% of total revenue in the latest financial year.

General and administrative expenses declined by 19.0% to $15.7 million in FY17, attributable mainly to lower staff costs, professional fees and other general and administrative expenses as well as the absence of allowance for doubtful debt in FY17.

Finance costs decreased from $5.6 million in FY16 to $4.5 million in FY17, due to lower borrowings and bank charges.

Despite narrowing losses on improved margins for certain projects, Yongnam says its margins continue to be depressed by the continued low level of strutting and other activities in Singapore and Hong Kong, which has resulted in overhead costs not being fully absorbed.

A provision was also made in anticipated of lower negotiated variation orders for the group’s Senoko Food Hub project.

As at end 2017, Yongnam’s order book stood at $152 million with $22.9 million worth of projects secured in the year-to-date in Singapore, which are expected to have a positive impact on the group’s financial performance in the current financial year.

“Despite the continued challenging business and operating environment in FY2017, the Group stayed focused on managing costs and realising greater efficiencies in our operations,” says Seow Soon Yong, CEO of Yongnam.

“Backed by our proven track record, cutting-edge fabrication technologies and reputation as an established structural steel contractor and specialist civil engineering solutions provider, the Group is well-positioned to seize opportunities locally and overseas to strengthen our order book,” he adds.

Shares in Yongnam closed flat at 30 cents on Thursday.

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